Nasdaq 10,000…I Am Really Serious

I have a lot more to say on Nasdaq 10,000 because when we get to Nasdaq 9,000 the Nasdaq 10,000 stuff I am writing now will be in every headline and useless.

One of the biggest changes between the Nasdaq bubble in the year 2,000 and the Nasdaq today is the fact that great internet growth companies have stayed private longer.

The real technology boom has been pre public.

One of the smartest and nicest investors I know is Manu Kumar who started K9 ventures and is a founder of Carta (I could have and should have invested).

In his latest blog post he nails the future in a post titled ‘The Logical Evolution of Private Markets: A New Kind of Company‘. Please read it, but in a nutshell:

5) A need for transparency: Most secondary transactions that are occurring are happening with very little information being made available to buyers and a lack of market efficiency for sellers. This is where I start to speculate a bit, that if we continue to see an increase in secondary transactions, then there will also be an increased need for transparency by these companies.

6) SEC oversight and regulation: The distinction between public companies and private companies has been very binary so far. I postulate that in the near future, we will see the emergence of a new class of company — one that is a privately held company, with a high valuation/market capitalization, and an active/regular secondary market for its stock.

Such a company would probably be asked to comply with a new/different set of rules and regulations than what exist today. The binary distinction of a private vs. public company is not going to be sufficient to capture the need for transparency and the fact that such a company will have an active/regular secondary market (albeit not publicly traded) will/should invite additional scrutiny and regulation.

This transitional class of company (a privately-traded company) can be viewed as a semi-private or semi-public company. If such a class of company dos exist in the future, it could further elongate the amount of time before companies enter the public phase of their existence.

Because of this transformation, I don’t really care when or if the Nasdaq actually does reach 10,000 because of the opportunities in private and privately-traded technology/software companies that continue to exist today.

Also published on Medium.